Founded in 2007, eToro became a popular trading app for its copy trading features, which allow traders and investors to copy trades from experienced and successful investors.
It is also well known for offering commission-free stocks and ETFs, passively managed portfolios (Smart Portfolios), and low minimum investment requirements.
Yet, many traders in the UAE look for alternatives due to certain challenges with eToro.
These include:
- 0.5%-1.5% currency conversion fee
- $5 withdrawal fee
- Inactivity fees of $10/month for accounts that have been dormant for 12 months
- 2% crypto transfer fees
- High minimum deposit ($1,000) for Islamic accounts
- High spreads on cryptos, CFDs, and forex pairs
- Lack of advanced charting tools and order types
But are there eToro alternatives that solve some or all of these problems?
In this article, we consider platforms similar to eToro that investors and traders in the UAE can explore in search of more cost-effective and convenient access to global markets.
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1. Sarwa: Best overall for UAE investors and traders
Overview
Sarwa is an all-in-one investment platform that offers both passive and active investing solutions to UAE residents. It provides access to stocks, stock ETFs, stock options, bond ETFs, REIT ETFs, commodity ETFs, and cryptocurrencies like bitcoin, among others.
It is licensed and regulated by the Financial Services Regulatory Authority (“FSRA”) in the Abu Dhabi Global Markets (“ADGM”).
Moreover, it is a UAE-based company that is familiar with the unique needs of UAE investors and traders. For example, it offers a Halal stock screener that helps halal investors select only stocks that comply with Islamic laws and investment principles.
Key advantages
- Free local bank transfers: Transfers between local UAE bank accounts and Sarwa’s brokerage accounts are free.
- Halal stock screener: Halal investors can use its stock screener to identify and select Halal stocks. This screener applies relevant criteria provided by the Accounting and Auditing Organization for Islamic Financial Institutions.
- Halal portfolios: Passive investors can also choose Sharia-compliant portfolios that invest only in Halal ETFs.
- SSL encryption: Sarwa protects users’ data and money with 256-bit encryption.
- Multiple investment outlets: Users can pursue an active strategy through Sarwa Trade or invest in passive portfolios designed by Sarwa’s wealth advisors through Sarwa Invest.
- Fractional investing: Sarwa Trade users can purchase a fraction of a share of stocks, ETFs, and cryptocurrencies.
- Educational resources: Through the large library of educational resources available on its blog, users can learn how to become better investors.
These resources cover topics as diverse as how to buy US stocks in the UAE, how to trade options in the UAE, and what you can learn from Warren Buffett’s stock holdings.
How it compares to eToro
If you are considering Sarwa as an alternative to eToro, below are the main points of how it compares to it:
- AED funding: UAE investors can fund their accounts in AED through local bank transfers, debit cards, and credit cards.
- Fees: Sarwa does not charge inactivity or currency conversion fees. Also, withdrawal fees are solely payment for the services of networks that process payments, rather than direct charges by Sarwa.
- Currency support: Sarwa supports both AED and USD. Also, local bank transfers are free.
- Crypto trading: Sarwa charges competitive spreads on crypto assets, but there are no separate crypto transfer fees.
- Halal accounts: You can access Halal portfolios, that follow Islamic laws and principles of investing with a minimum balance of $500. Also, you can purchase halal stocks on Sarwa Trade with a minimum balance of $500.
2. Interactive Brokers: Best for advanced traders
Overview
Interactive Brokers is a global online trading platform that is available to UAE investors and regulated in Dubai by the Dubai Financial Services Authority (DFSA).
It offers access to stocks, ETFs, bonds, mutual funds, currencies, cryptocurrencies, and futures across more than 90 market centres.
Key advantages
- Professional-grade tools: Interactive Brokers is well known for its top-tier charting and technical analysis tools available via its Trader Workstation (for professional traders) and IBKR Mobile (for retail investors) platforms.
- Low commissions: Commission on stock trading is as low as $0.0005 to $0.0035 per share. They also charge competitive commissions on other assets.
- No account minimum: Users can trade a variety of assets with no minimum trading balance requirement.
- Fractional trading: Users can purchase fractions of a share of all relevant assets.
- Global multi-asset access: As a global investing and trading platform, Interactive Brokers provides access to assets across 90 global market centers.
- Multiple currency accounts: Interactive Brokers supports multiple currencies, including AED, GBP, EUR, USD, and JPY, among others.
How it compares to eToro
Some of the differences between Interactive Brokers and eToro include:
- Advanced trading tools: Interactive Brokers offers a range of professional tools for algorithmic trading and real-time charting.
- Fees: Interactive Brokers does not charge account inactivity fees. However, a 0.002% currency conversion fee applies.
- Crypto trading: Commissions on cryptos range from 0.12%-0.18%, and there are no extra transfer fees.
- AED funding: UAE investors can fund their accounts with dirhams.
3. Saxo Bank: Best for global access to multiple asset classes
Overview
Saxo Bank is a global investment and trading platform that is licensed to operate in the UAE by the DFSA.
It offers access to stocks, ETFs, bonds, commodities, currencies, and futures across 50 global exchanges.
Saxo Bank is also known for its professional-grade trading environment, which makes it popular among professional and advanced retail investors.
Key advantages
- Advanced trading tools: The SaxoTraderPRO platform contains many professional-grade charting tools that advanced traders will find helpful.
- User-friendly platform: Saxo also offers SaxoTraderGO as an alternative beginner-friendly platform.
- Managed portfolios: Users can purchase pre-built and professionally managed portfolios that are curated by Saxo’s investment team.
- Stock lending: Users can earn passive income by lending their stocks to others.
- Global access: Saxo Bank offers access to multiple assets across the globe.
How it compares to eToro
Some of the differences between Saxo Bank and eToro include:
- Fees: Saxo Bank also charges currency conversion fees (plus or minus 0.50%), but there are no account inactivity fees. However, there is a custody fee (0.05%-0.15%) on certain orders.
- Trading platform: While it offers a beginner-friendly platform, there is also an option for experienced investors.
- AED funding: Users can make direct deposits in AED.
4. XTB: Best for CFD trading
Overview
XTB is an investment and trading platform that offers access to stocks, ETFs, and CFDs on forex, indices, cryptos, and commodities. It is regulated in the UAE by the DFSA.
Key advantages
- No minimum deposit: XTB does not require a minimum starting balance.
- Low spreads: The platform is also known for its low spreads.
- Educational resources: XTB provides many beginner-friendly educational resources to users.
- Beginner-friendly platforms: Both xStation 5 and xStation Mobile are beginner-friendly, even though they are packed with multiple analytics tools.
- Low minimum account balance: There is a $10 minimum balance for investment accounts. Trading accounts do not have any minimum balance requirement.
How it compares to eToro
Below are some key points of difference between XTB and eToro.
- Fees: No inactivity fees, but currency conversion fees apply.
- AED funding: The platform supports direct AED deposits.
- No minimum deposit on halal accounts: Halal accounts on XTB do not have minimum deposit requirements.
5. Trading 212: Best for beginners
Overview
Trading 212 is a UK-based investment platform that is regulated by the Financial Conduct Authority (FCA). Though it is available to UAE users, it is not separately licensed and regulated by the DFSA or the FSRA.
It offers access to stocks, ETFs, and CFDs on stocks, forex, and indices.
Key advantages
- Commission-free investing: Trading 212 provides free stock and ETF trading for all users.
- Fractional investing: Users can invest as little as $1 by buying fractions of a share.
- Low minimum deposit: Users can deposit as low as $1.
- Beginner-friendly platform: Trading 212 is simple to use for beginner investors.
- Global market access: Users can access over 10,000 stocks and ETFs from the US, the UK, and European exchanges.
How it compares to eToro
- Fees: Trading 212 does not charge inactivity fees, but there is an FX conversion fee and a deposit fee for amounts above a given threshold.
How to choose the best investment platform in the UAE
So far, we have considered investment apps like eToro that improve on some of its cons.
Perhaps you are still unsure of which provider to choose, especially given that eToro also has some pros like its social trading feature and the Smart Portfolios product.
To that end, it is crucial to identify the factors you should prioritize when choosing an investment platform in the UAE.
Below are some of the most important ones:
- Local regulation: Knowing that the investment platform you use is regulated by local authorities gives you greater confidence that they will act in your best interest, compelled by regulatory standards.
- Investment or trading strategies: If you are a pure long-term investor, you should select online brokers that emphasize fundamental analysis tools. On the other hand, if you are trading stocks, your favorite platform will have appropriate technical analysis tools.
- Investment or trading skill level: If you are a beginner, focus on beginner-friendly platforms with a shallow learning curve. And if you are an experienced investor with complex investment strategies, select those with the required advanced tools.
- Total cost: Though many platforms now offer commission-free trading, we have seen that commissions are only a part of the total trading fees. There are currency conversion fees, withdrawal fees, deposit fees, account inactivity fees, transfer fees, and custody fees, among others.
Instead of evaluating platforms based on commissions (and spreads) only, take a deeper dive into the entire pricing structure.
Also, it is crucial to select investment platforms that are transparent with their fee structures. In other words, avoid platforms with hidden fees of any kind.
- Asset availability: You should also choose a platform that provides access to the range of assets you want to invest in or trade.
The key is to focus on what you need rather than selecting a platform with many cons, but with a large number of financial instruments you don’t need.
- Cybersecurity: A good investment platform will also protect your data and money with a modern and scalable cybersecurity architecture.
- Support: A good investment platform will support your investment journey with a responsive customer support team and timely educational resources.
If you are looking for the best alternatives to eToro in the UAE, Sarwa is one platform to consider.
It charges low commissions and spreads and excludes many of the fees other platforms charge.
Sarwa is located and regulated in the UAE and offers halal investing options. You will also get access to a wide range of assets while enjoying free local bank transfers.
Furthermore, Sarwa supports your investment journey with educational resources and personalized customer support, while protecting your data and money with 256-bit encryption.
Are you ready to start your investment journey in the UAE? Sign up now for an account with Sarwa for low-cost, convenient, and secure access to global markets.
Takeaways
- eToro is popular, but UAE investors have other options. Platforms like Sarwa offer low spreads and commissions, limited fees, accessible halal accounts, and other trading features designed specifically for UAE residents.
- When choosing investment platforms, fees matter beyond commissions. Currency conversion charges, withdrawal fees, inactivity fees, and custody fees can significantly impact long-term returns.
- Different platforms serve different investor types; some are beginner-friendly, while others cater to more advanced traders.
- UAE investors seeking Sharia-compliant investing and local regulatory oversight may find fewer options, making platforms like Sarwa stand out.